A lot can derail a trip, including political upheaval and natural catastrophe. Travel insurance can get you back home
Too often when I turn on the news or read the newspaper, I am transfixed by another political or natural crisis — often in places I’ve been: An earthquake in Haiti, which I visited more than 25 years ago. A revolution in Egypt, exactly two years after I was there. An earthquake in New Zealand, where I will be in November. An earthquake in Japan, which I’ve never visited, but which launched a tsunami that raced across the Pacific, including a dramatic blast by Maui and the Big Island of Hawaii en route to the West Coast. What if I were wherever epicenter of the headlines is, I wonder — unhurt but needing to get out and get home?
When world headlines are made by revolutions or natural disasters, tourists can be caught. Their predicament is more along the lines of inconvenience that pales in comparison with refugees fleeing political violence or natural disaster, but it’s very real and very scary at the time. Getting out of a very troubled area is often a logistical nightmare — and can be expensive as well. That’s when travel insurance can kicks in– if it is the right kind. John W. Cook, president of QuoteWright.com, which provides online comparisons of travel insurance, sorts it out like this:
1. Most basic trip cancellation and trip interruption coverage provides coverage for terrorism; however, it is mostly limited to an actual terrorist event which happens in a city on the traveler’s itinerary within 30 days of the traveler’s scheduled arrival. Most policies will cover both domestic and foreign events.
2. Some policies limit coverage to an actual terrorist event which happens in a city on the traveler’s itinerary within 7 days of the traveler’s departure date.
3. Some policies may require that coverage be purchased within two weeks of the first trip payment in order for the coverage to be activated.
4. Some policies may exclude coverage if a terrorist event has occurred within the city or country within the prior 6 months or if a Travel Warning has been issued for travel to that country or region.
5. “Terrorist Event” is defined differently by travel insurance policies however; civil disorder, riots, and war are not covered.
Cook explains, “Trip cancellation and trip interruption coverage is a “named peril” coverage that relies on the covered reason, policy definitions, and exclusions to determine coverage. Contrary to some published reports an elevation of the travel alert to a travel warning will not trigger coverage. As a whole, travel insurance policies require an actual terrorist event to occur in order for coverage to apply so even if the Department of State elevates the alert to a warning coverage will not apply without an actual event occurring and then only if it complies with the policy provisions. It may, however, affect future coverage since some policies exclude travel to an area where a Travel Warning has been issued.
“Some policies offer a ‘cancel for any reason’ option that can be added to the policy at the time of purchase which provides a safety net for cancellations not covered by the basic coverage. Eligibility for this coverage is usually dependent on buying coverage within 2 to 3 weeks from your first trip payment date. This option allows you to cancel for any reason other than one already covered by the basic coverage, however, there are pre-conditions. Usually you have to buy the plan and option within 2 to 3 weeks following your first payment date, you must insure your trip to its full pre-paid value, and if you cancel for a reason that is not other wised covered than you must do so at least 2 or more days prior to departure.”
Some insurance companies respond heroically to a crisis. On Call International, for instance, sent a plane to Egypt on January 31 to evacuate 150 travelers who had bought their insurance. Their several insurance plans include a specific Political Evacuation and Natural Disaster Evacuation add-on to their basic travel and medical coverage. It costs $85 for a single trip ($95 for seniors 77-plus) and covers up to $100,000 for evacuation to a safe area and then home, and I’m betting the 150 travelers on that plane that it was worth every penny.
Natural disasters are another matter. In a little more than a year, the world has witnessed devastating earthquakes in Haiti, Regarding the earthquake in Japan and the resulting tsunami that raced across the Pacific, he cautions, “The earthquake and resulting tsunami are probably going to be classified by travel insurance companies as a ‘natural disaster.’ This classification can have a big effect on coverage for trip cancellation and interruption coverages. Under those coverages some, but not all, companies include ‘natural disasters’ which causes your airline to cease operations to be a covered event. Most of the plans limit coverage for ‘natural disasters’ that make your destination uninhabitable.” Coverage for travel delay is also a “named peril,” with benefits in the majority of plans including “natural disaster” as a covered event. Mondial Assistance, another travel insurance provider, cautions that “as with all travel insurance coverages, the event that causes your loss has to be reasonably unforeseeable at the time you purchased your policy.”
In the past, I have been cavalier about travel insurance, but now, it’s as much a part of my travel documents as my passport and my AAA card.